MONTREAL — Several Quebec Tim Hortons franchisees are taking the brand's owner to court, blaming what they describe as unreasonable constraints in the company's licensing agreements for lower-than-expected profits.
MONTREAL — Several Quebec Tim Hortons franchisees are taking the brand's owner to court, blaming what they describe as unreasonable constraints in the company's licensing agreements for lower-than-expected profits.
"Through these Tim Hortons licence agreements ... TDL controls every essential lever involved in the running of a restaurant," from deals with suppliers to equipment," the plaintiffs allege in their application. Yet TDL's policy of fixing prices didn't adapt to the market, the franchisees assert. They argue the franchisor's rules leave them"no room for manoeuvre" and impose costs they are unable to match in sales. A resulting blow to their profits has reduced the value of their restaurants and made it difficult for them to bear the cost of renovations and other investments that TDL expects, they say.
Meanwhile appeals for reform, such as flexibility to set prices for some products within an agreed upon range, were unsuccessful, the statement of claim says.
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